Lord Altrincham (Con)

My Lords, I note my interest as a director of the Co-operative Bank, which has agreed to be acquired by the Coventry Building Society. I agree with the comments from the noble Baroness, Lady Jones, on the advantages of the mutual sector. I possibly hesitate to agree with the comments of the noble Baroness, Lady Kramer, given that the Co-operative Bank is not the best example of the virtue of the mutual sector as opposed to capitalising banks under the Companies Act in the normal way and funding them in public markets. These things can be looked at in different ways. Building societies have long been the backbone of local communities. They embody the principles of mutuality and prudence, offering a model of finance that places people before profit. Yet, as our economy evolves and the needs of homeowners and savers shift, so too must the regulations that govern these vital institutions. This draft order amends Sections 60 and 61 of the 1986 Act to remove all references to the normal retirement age or the compulsory retirement age for directors. It will update that Act in line with the Companies Act 2006, under which there are no longer corresponding restrictions for company directors following the repeal of Sections 293 and 294 of the Companies Act 1985 by Section 1295 of and Schedule 16 to the 2006 Act. The draft order also amends Section 80(1) of the 1986 Act so that the current requirement for the balance sheet of a building society to be signed by two directors and the CEO is changed to allow one director to sign the balance sheet on behalf of the board. We would support that on these Benches. This amendment will modernise the 1986 Act, aligning the provisions with Section 414 of the 2006 Act and, on these Benches, we welcome it. This order would reduce a small but unnecessary burden on building societies, providing them with the equivalent accounts sign-off procedures for companies. It makes sense to modernise the 1986 Act, or at least to bring it in line with the Companies Act 2006. As Conservatives, we will not oppose a measure that will ease unnecessary burdens on businesses and financial institutions, and thus I welcome this order.